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Innodata Inc. Message Board

  • obliden obliden Apr 25, 2013 8:56 AM Flag

    Beat earnings

    1 cent versus 3 cents loss estimate

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    • richeydouglas@ymail.com richeydouglas Apr 25, 2013 9:38 AM Flag

      actually I was expecting a 4 to 5 cent loss for the quarter and was surprised myself...a loss is never good and the stock price may take a hit short term... revenue should ramp up in the next few quarters as investments made by the company should start to pay off... lets hope anyway.

      • 1 Reply to richeydouglas
      • a very underwhelming conference call. Interesting how one of the callers zeroed in on Jack increasing the potential market size for Synodex from $500M to $1B, with Jack explaining that now he is including the UK market in his analysis. That was pretty quick thinking, Jack. except that the UK insurance market is a fraction of the size of the US market, so you managed to fool the caller, but you really didn't explain how even $500M translates into a revenue stream for Innodata. There are about 10M life insurance policies written in the US annually, and that market has been in a flat/decline mode for 20 yrs. So let's be optimistic and say that Synodex captures 100% of the underwriting market. What exactly is the value proposition that Synodex brings to market that insurance companies are willing to shell out $50 per application? Jack mentioned connecting brokers to carriers - really? There are at least a dozen platforms that do that already and the top 3 handle about 70% of the traffic and compete very fiercely for this low margin transaction business. And that traffic is all transaction business that translates to $1-3 per policy. Let's say Innodata actually has a killer app and insurance companies will pay $5. So now we have a market worth $50M. Where is the other $450M coming from, Jack? Summarizing medical charts? More than 75% of policies are issued without the use of medical charts. So now our market is down to about 2.5M policies. And of the medical charts ordered for underwriting, 85% of the charts are less than 40 pages, so there really isn't a reason for underwriters to pay to have a chart summarized when they can review the charts in less time than it takes your staff to actually summarize it.

        So where is the market, Jack? How about sprinkling some substance into your optimism. Inquiring minds would really like to know.

 
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